$10bn health budget not enough: state ministers

Funding for public hospitals was in crisis after Labor states yesterday rejected a $10billion federal funding offer.

State health ministers failed to reach an agreement with their federal counterpart, Kay Patterson, leaving Canberra with no guarantee of a funding increase to meet growing patient numbers.

The Federal Government offered a $10 billion increase over five years to a maximum $42billion on condition that states matched that contribution and improved accountability.

Senator Patterson said before the meeting began the package was not negotiable. It was rejected unanimously.

The West Australian Health Minister and chairman of the Australian Health Minister's Conference, Bob Kucera, said the states were given an ultimatum to take or leave the package. "On Monday John Howard buried Medicare and today they've killed the hospitals," he said. ");document.write("

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Mr Kucera said the original Federal Government offer was an $11 billion increase revised down to $10 billion.

The states argued the deal stripped $1billion from the current agreement and that the goalposts had been moved since the announcement of proposed Medicare reforms this week.

"If we stayed with what we had, we'd be $1billion better off," the Victorian Health Minister, Bronwyn Pike, said. "[Senator Patterson] refuses to negotiate." The NSW Health Minister, Morris Iemma, said the Commonwealth was determined to shift the cost of public hospitals back onto the states at a time when Medicare reforms would place even more pressure on the system.

Senator Patterson said the Government's offer was generous and she expected the states would sign up in time. If not, the agreement would revert to the current one, indexed to wage rises slightly lower than inflation.

"We would expect them to do the same as we are, putting the amount of money they'll spend on the table and what their growth will be," she said. "What they expect of the Commonwealth, the states ought to be prepared to do."

She said she would consider meeting again with state ministers only when they disclosed their expenditure.